Fishmeal industry

overview

Jonathan Shepherd, Andrew Jackson and

Jean-Francois Mittaine

Visit to FAO
July 4th 2007
 What is IFFO?

The International Fishmeal and Fish Oil

Organisation, the global trade association
representing fishmeal and fish oil
producers and related trades.
Represents two-thirds of world production
plus 95% of exports of fishmeal and fish
oil worldwide
 History of fishmeal & oil use
1950-1969 - Fish Oil extracted for production of margarines
and soaps. Fishmeal more a by-product used for fertilizer &
animal feed

1970-1989 - Fishmeal important feed ingredient in intensive

animal production (poultry, cattle & pigs). Oil becomes
more of a by-product often just used for fuel

1990-2009 - Fishmeal increasingly used in aquaculture diets

and becoming a strategic ingredient for critical phases in
the lifecycle of animal production due to its unique
nutritional qualities. Fish Oil increasingly valued for its
health and nutritional benefits to humans and animals
Annual Fishmeal & Fish oil Production

Fishmeal & Fish Oil Production

8
7
tonnes millions

6
5
Fishmeal
4
Fish Oil
3
2
1
0

)
86

88

90

92

94

96

98

00

02

04

st
(e
19

19

19

19

19

19

19

20

20

20

06
20
IFFO Data
Fishmeal Production by Country or Region

Major Fishmeal Producers

7000 Others
South Africa
6000
Japan
5000
USA
tonnes ,000

4000 Thailand
3000 China

2000 Scandinavia*
Chile
1000
Peru
0
2000 2001 2002 2003 2004 2005 2006
(prov)

IFFO Data
Estimated Global Fishmeal Consumption
Fishmeal Consumption 2002 (tonnes ,000)

558,( 9%)

Aquaculture
1364,(22%)
2769, (45%) Pigs
Poultry
Others

1513, (24%)
Consumption of Fish Meal 2006 (tonnes ,000)
IFFO Data

359, (6%)
739, (13%)

3055, (57%)
1147, (21%)
 Estimated Aquaculture Consumption
Consumption of Fishmeal 2006 (tonnes ,000)
18, (1%)

Shrimp
(60, 2%)
FW Crustaceans
515, (17%)
723, (23%) Marine Fish
28, (1%) Salmon
148, (5%) Trout
146, (5%)
193, (6%) Eel
Milkfish
525, (17%) 698, (23%) Carp
Tilapia
Catfish

IFFO/FAO Data
 World Fishmeal Consumption
WORLD FISH MEAL CONSUMPTION AND STOCKS
Far East Europe Americas All others

8000
7103
6809 6897.5 6665.6
7000 6520.4 6034
6390.6 6235.8
5835.1
6000
5383.8
Thousand Tonnes

5170.8
5000

4000

3000

2000

1000

0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

YEAR
 Summary of trends in Fishmeal

Production of fishmeal has remained relatively constant

Approximately 40% of production comes from South

America

Aquaculture now represents over 50% of consumption

South East Asia now represents over 50% of consumption

Growing importance of Aquaculture & S.E. Asia

 Summary of trends in Fish Oil

Production of fish oil has remained relatively constant

Approximately 40% of production comes from South

America

Aquaculture now represents over 80% of consumption

Salmon now consumes nearly 40% of world production

Fishmeal Price/Production/Consumption
FOB PERU FISHMEAL (F.A.Q.) PRICES
1 300 From Jan. 2004 to June 2007
US$/MT
1 200
1 100
2004 2005
1 000
900 CHINA - Fishmeal Imports 2004-2006 (in 1000 M T)
800
2006 2007 1 700
700
1 500
600
500 1 300

400 1 100
2004
w07
w13
w19
w25
w31
w37
w43
w49
w02
w08
w14
w20
w26
w32
w38
w44
w50
w04
w10
w16
w22
w28
w34
w40
w46
2
w 06
w 12
w 18
w 24
900

700

Peruvian Fishmeal Production 500

Years 2004 - 2006 (in 1000 MT) 2004 2005 2006

2 200
2 000
1 800
1 600
1 400
1 200
1 000
2004 2005 2006
 Fish Meal and Fish Oil will not limit
aquaculture growth I
Estimated Feed Production
Aquaculture Feed Production

35000 Catfish
Production tonnes ,000

Tilapia
30000
Carp
25000
Milkfish
20000
Eel
15000
Trout
10000
Salmon
5000 Marine Fish
0 Freshwater Crustaceans
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Shrimp

FAO 2006
 Fishmeal and Fish Oil will not limit
aquaculture growth II
Estimated Fishmeal Usage
Fishmeal Usage

4000 Catfish
3500 Tilapia
Usage tonnes ,000

3000 Carp
2500 Milkfish
2000 Eel
1500 Trout
1000 Salmon
500 Marine Fish
0 Freshwater Crustaceans
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Shrimp

Based on FAO 2006 with IFFO data

 Fishmeal and Fish Oil will not limit
aquaculture growth III
Estimated Fish Oil Usage

Fish Oil Usage

1000.0 Catfish
Tilapia
Usage tonnes ,000

800.0 Carp

600.0 Milkfish
Eel
400.0 Trout

200.0 Salmon
Marine Fish
0.0 Freshwater Crustaceans
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Shrimp

Based on FAO 2006 with IFFO data

Assumption of fishmeal inclusion
%
2002 2006 2010

Shrimp 24 19 16

Marine Fish 41 38 34

Salmon 35 30 25

Eel 47 40 37

Tilapia 5 4 3
 Fishmeal and Fish Oil will not limit
aquaculture growth IV
% Use of Global Production
Percentage Use in Aquaculture

100.0

80.0

60.0 Fishmeal% used in Aqua

%

40.0 Fish Oil % used in Aqua

20.0

0.0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Based on FAO 2006 with IFFO data

 Most Feed Fisheries are being managed
sustainably
The most obvious evidence is that output has remained relatively
constant for decades

The world’s largest fishery in Peru contracts due to an El Niño every

few years, but is managed back to give a Maximum Sustainable Yield

Unlike most fishing for human consumption, feed fish are mostly small
bony almost inedible pelagic fish with a short life-cycle, therefore
recovery is rapid

Most major feed fisheries are controlled by TAC’s, area catch limits,
seasonal bans, min. mesh sizes, vessel registration satellite tracking
and monitoring of all landings e.g. SGS in Peru

Mistakes have been made in the past, but improved stock knowledge
and management controls have had a beneficial effect
 Eco-efficiency wild to farmed

3.00

2.50
Ratio Wild to Farmed

2.00
All Aquaculture
1.50
Bellona Salmon
1.00

0.50

0.00
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Based on FAO 2006 with IFFO data

 Eco-efficiency wild to farmed

3.00

2.50
Ratio Wild to Farmed

2.00
All Aquaculture
1.50 Carnivores only
Bellona Salmon
1.00

0.50

0.00
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Based on FAO 2006 with IFFO data

 Optimal use of the Resource

An increasing amount of fishmeal is coming from fish

processing by-products e.g. trimmings

There are increasing amounts of meal and oil being

produced from aquaculture processing

The estimated 1.5 million tonnes of salmon harvested

this year could yield around 30,000 tonnes of
fishmeal and 20,000 tonnes of fish oil

All this further improves the eco-efficiency calculation

 New Resources – not many

Discarded By-catch
• Many economic reasons for dumping of
incidentally caught fish

• Recent estimates put the figure at 7.3 million

tonnes worldwide (FAO 2005)

• Efforts are being made to reduce the figure and it

has come down in recent years

• Catch should be minimised – should the remainder

be made into fishmeal & fish oil ?
 New Resources 2
Trash Fish

• Estimated 5-6 million tonnes of low value wet fish

used in Asian aquaculture (Allan 2004)
• More efficient use if turned into meal & oil

Antarctic Krill

• Biomass of 400-500 million tonnes

• Sustainable annual catch of 4-5 million tonnes
• This would yield 500,000-750,000 of meal
• Currently only about 100,000 tonnes harvested
• Aker Seafood Corp about to start increasing krill
meal production, investing heavily
 Factors Influencing Supply

• Regulations affecting fishing areas & quotas

• Natural Variation e.g. el Niño

• Fishing Effort

• Demand for direct human consumption

• Developments e.g. by-product utilisation, krill

 Factors Affecting Demand
• Price elasticity of demand
• Growth of aquaculture
• Growth of Chinese protein production
• Cost effective alternatives (including with
new technology, biofuel etc)
• Growing appreciation of the role of EPA
and DHA Ω-3 fatty acids in human and
animal nutrition
• Consumers’ perception of the
sustainability of fishmeal and fish oil
 Factors Influencing Demand
Barriers to substitution
Fishmeal +ves
+ves Substitution -ves
High protein-
protein- dietary space High fibre

Almost perfect amino acid profile Amino acid deficiencies

Residual health promoting oil Perceived health risks - MBM

No anti-
anti-nutritional factors
High palatability & digestibility
Anti-
Anti-nutritional factors & enzyme
inhibition
Low palatability & digestibility

UGF & immunostimulants Poor growth & survival

Perceived as entirely natural GM issues and un-

un-natural
 Changing role of fishmeal & fish oil

2002 2006 2012

Poultry Grower diets Starter diets Breeder diets &

recovery diets

Pigs Grower diets Creep & Breeder &

Weaner diets recovery diets

Fish High use in most Moderate use Starter, finisher,

diets in most diets broodstock &
recovery diets

Commodity Strategic Ingredient

Incr animal prod.
Decr FM inclusion
Constant FM prod.
 Future implications

Despite new resources total volumes of Fishmeal/Oil are likely
to remain relatively constant

As the cost of Fishmeal/Oil rises, so their inclusion level will

decrease

But Aquaculture is still growing strongly so that the total

volumes fed to aquaculture will in future be higher than today
while less will go to terrestrial agriculture

Farmers have same overall feed cost but feeds deliver high
performance and yield healthy livestock products with natural
EPA and DHA

Consumers can be confident they are being given safe and

healthy products from a well managed sustainable source